The investment bank’s June analysis frames the climate event as a multi-year inflationary shock rather than a single-season disruption, with supply chains still catching up through 2028 before prices stabilize.
Which Foods Are Most Exposed
The Goldman Sachs report singles out five commodities as the most vulnerable to Super El Niño-driven supply shocks: rice, sugar, palm oil, coffee, and cocoa. Each depends on tropical production regions that El Niño tends to parch or flood.
For these staples, the bank projects price increases between 50% and 100% — a range that would hit household budgets hardest in import-dependent nations and low-income economies where food consumes a larger share of income.
Why the Impact Lingers
El Niño’s price effects rarely unwind in a single harvest cycle. Drought-stressed palm plantations and cocoa farms need years to restore yields. Rice paddies drained by irregular monsoons must be replanted and regrown. Sugar and coffee harvests follow annual or biennial cycles, meaning a failed 2026 season pushes recovery into late 2027 or beyond.
The Goldman Sachs analysis found that these supply-side bottlenecks would ripple across the global economy, gradually raising food prices well into 2028 before inventories rebuild and markets find equilibrium.
Context Beyond the Report
El Niño is the warm phase of the El Niño-Southern Oscillation, marked by elevated sea surface temperatures in the equatorial Pacific. A “Super El Niño” refers to an event of exceptional intensity, comparable to the 1997-98 and 2015-16 episodes that disrupted agriculture from Southeast Asia to South America.
What sets the current forecast apart is timing. Food inflation has only recently cooled from the post-pandemic and Ukraine-war spikes. A fresh Super El Niño shock would arrive before global grain reserves and fertilizer markets have fully normalized, compounding the price response.
What Happens Next
Watch the National Oceanic and Atmospheric Administration’s fall ENSO outlook for confirmation of Super El Niño intensity. Track futures markets in cocoa, coffee, and palm oil — the most weather-sensitive of the five flagged staples. Governments in rice-importing nations may accelerate strategic reserves or impose export controls, as India did in 2023. For consumers, the Goldman Sachs food price forecast suggests budgeting for elevated grocery costs through at least 2028, with the sharpest increases concentrated in tropical commodities and products derived from them.
— Isabella Morales, food desk, AXO News